CoinDesk 20 Index: 2,066.01 +1.2%
Bitcoin (BTC): $68,101.44 3.96%
Ether (ETH): $2,629.35 +1.16%
S&P 500: 5,815.26 -0.76%
Gold: $2,678.07 +0.65%
Nikkei 225: 39,180.30 -1.83%

Bitcoin rose above $68,000, extending the weekly gain to over 8%. BTC has gained nearly 4% in the last 24 hours, comfortably outperforming the wider digital asset market, which is around 1.4% higher, as measured by the CoinDesk 20 Index.The cryptocurrency teased a move above $68,000 during the U.S. morning on Tuesday before falling as low as $64,800 only an hour later. Spot bitcoin ETFs recorded inflows of $371 million on Tuesday, making it three days in a row that they have registered over $250 million of gains, the first time such instance since July 16, according to SoSoValue.

BTC futures open-interest on the Chicago Mercantile Exchange has hit a new all-time high of 172,430 BTC ($11.6 billion). In the past five trading days, CME has seen open interest ramp up by 25,125 BTC, marking one of the highest recorded changes in recent years. - A somewhat similar spike in open interest was seen in June 2023, when , bitcoin surged from approximately $25,000 to $30,000. Vetle Lunde, senior analyst at K33 Research, noted that active and direct market participants are driving this growth on the CME, and it's not coming from futures-based ETFs such as ProShares Bitcoin ETF (BITO). Lunde also pointed out that activity is structured around the November expiry, following the U.S. election.

Grayscale Investments has filed to turn its multi-token fund, the Grayscale Digital Large Cap Fund (GDLC), into an ETF, adding to its offerings of crypto ETFs after the conversion of its bitcoin and ether funds earlier this year. The fund tracks the CoinDesk Large Cap Select Index which measures the market cap weighted performance of five of the largest cryptocurrencies, including bitcoin, ether, solana, XRP, and avalanche. Once approved and converted into an ETF, the fund which currently trades over the counter, will trade on the New York Stock Exchange, which submitted a 19b-4 filing with the SEC on Tuesday.

Bitcoin generally maintains a negative correlation with the dollar index (DXY). However, this dynamic may break down around the U.S. election time if the prevailing options pricing is any guide.

One-month 25-delta BTC risk reversals, the skew in the premium paid for calls relative to puts was 1.20, indicating a bullish bias for the next four weeks, according to options trading listed at the Chicago Mercantile Exchange, widely considered a proxy for institutional activity.

Meanwhile, 30-day risk reversals for the euro-dollar (EUR/USD), the world's most liquid pair, was -0.39 on the CME, indicating concerns of continued dollar strength in the coming four weeks. The GBP/USD risk reversals suggested the same.

In other words, options signal a continued rally in the dollar index, one of BTC's top nemesis. The euro is the largest component of the dollar index, making up 57.6% of the basket.

It's worth noting that bitcoin has already begun ignoring the dollar index. BTC rose to nearly $68,000 Monday, reaching the highest since July 29 even as the dollar index held steady above 103.00, consolidating on its 3% rise since late September, data from TradingView show.

- Omkar Godbole